Sequestration's threat to commissaries

Sequestration's threat to commissaries

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Posts: 3010

Oct 19 12 6:50 PM

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ByTom Philpott

Published: October 18, 2012

Sequestration's threat to commissaries

Published: October 18, 2012

Taxpayer support of base grocery stores this fiscal year would fall by $130 million, or 9.4 percent, if Congress fails to reach a debt-reduction deal by Jan. 2, its deadline to avoid arbitrary budget cuts mandated by the sequestration mechanism in last year’s Budget Control Act.

The Office of Management and Budget delivered that news to Capitol Hill in a larger report that Congress required to make the impact of the sequestration threat more transparent to voters.

A commissary budget cut of that size, which stores likely would be forced to absorb over just the last six to nine months of fiscal 2013, intensifying its effect, “would be devastating,” says Tom Gordy, president of Armed Forces Marketing Council. The council represents manufacturers of products sold in military stores.

Commissary shoppers, Gordy said, likely would see store hours and staff services cut by next spring, and might even see some stores closed in areas where two or more bases are co-located. Commissary budgets are used almost entirely for wages and benefits of its 18,000 employees.

About two thirds of employees, Gordy notes, are affiliated with the military, either family of active duty members or military retirees, retiree spouses or military veterans. Many employees would see work hours and, therefore, incomes cut by the sequestration knife.

Exchanges or base department stores would not be impacted because they are self-sustaining, with staff salaries and other operating costs paid for through store-generated profits.

Commissaries, however, rely on annual taxpayer subsidy of $1.4 billion. In return, military patrons see savings of about 30 percent on their groceries, a popular benefit worth about $2.8 billion annually. Goods are sold at cost plus a five percent surcharge. The surcharge money is used to modernize old stores and build new ones.

The commissary appropriation, like funding for most other defense and non-defense discretionary spending, would be hit by the sequestration process that both Republicans and Democrats agreed to accept as an intolerable result if they could not muster the political courage themselves to reach a fresh $1.2 trillion, 10-year debt reduction agreement.

Some key lawmakers, worried that this pitiable Congress still lacks leadership and character to negotiate a debt deal after the election, one with real compromises and meaningful tradeoffs, is said to be drafting stop-gap legislation to delay sequestration’s impact for at least several months.

The White House is signaling that President Obama won’t accept anything short of a “balanced” debt deal to avoid sequestration, a deal that would include higher taxes on the wealthy, which is something most Republicans have pledged not to consider.

The Defense Commissary Agency, which oversees military grocery operations worldwide from its headquarters on Fort Lee, Va., won’t comment on the potential impact of sequestration. DECA is operating, like the rest of the Department of Defense, on the assumption lawmakers will act to avoid sequestration and compromise on a plan to address the nation’s $16 trillion debt crisis. With this Congress, however, the sequestration mechanism seems about as thoughtful as passing a loaded gun to a pouting child.

Gordy said DeCA probably could absorb a five percent cut without shoppers being impacted. That could be handled, for example, by layoffs of some headquarter employees or by enticing older careerists to retire early.

“There would be pain but it’s manageable,” Gordy said. Above five percent, however, and staff furloughs have to be large enough to impact store hours and even force some stores closures.

OK....the congress has not passed a budget in three years!!! How will there be "budget cuts" when there is no goddamn budget?

Blame this on the congress that said (at least the GOP said and were open and adamant about it!), "Our sole goal is to make Obama a one term president", and stonewalling the budget is clearly a political disgrace and damned near a crime!

We few, we happy few, we band of brothers—For whoever sheds his blood with me today shall be my brother.

nmfxstc wrote:OK....the congress has not passed a budget in three years!!! How will there be "budget cuts" when there is no goddamn budget?

Blame this on the congress that said (at least the GOP said and were open and adamant about it!), "Our sole goal is to make Obama a one term president", and stonewalling the budget is clearly a political disgrace and damned near a crime!

Bull$$$$! Where are the budgets from Obama's first two years. What's the excuse, when they had all three branches? Should we arrest all the Dems?

nmfxstc wrote:OK....the congress has not passed a budget in three years!!! How will there be "budget cuts" when there is no goddamn budget?

Blame this on the congress that said (at least the GOP said and were open and adamant about it!), "Our sole goal is to make Obama a one term president", and stonewalling the budget is clearly a political disgrace and damned near a crime!

Bull$$$$! Where are the budgets from Obama's first two years. What's the excuse, when they had all three branches? Should we arrest all the Dems?

Here is an excerpt from a post on another site that explains this issue.

It's true that you cannot filibuster a budget resolution in the Senate,
because the Budget Act provides special rules for consideration of a
budget resolution, including a time limit on debate. So the Senate can
pass a resolution with only a majority vote. However, the resolution
does not take effect when the Senate passes it. It takes effect in one
of two ways: if the House and Senate pass an identical resolution,
usually in the form of a conference report; or if the Senate passes a
separate Senate Resolution (as opposed to a concurrent resolution, which
is what a budget resolution is) that says the House is “deemed” to have
agreed to the budget resolution passed by the Senate.

But there are no special procedures for the simple Senate Resolution
required by this second, “deeming” process, so it is subject to the
unlimited debate allowed on almost everything in the Senate. If you do
not have the support of 60 Senators to invoke cloture and end a
filibuster, or prevent a filibuster from even starting (because everyone
knows 60 Senators support cloture), you cannot pass such a deeming
resolution in the Senate.

Because its rules are different, the House with a simple majority can
pass a resolution deeming that the House and Senate have agreed to the
House resolution so that it can take effect. This means the allocations
in the resolution, such as for appropriations, are in effect in the
House and anybody can raise a point-of-order against legislation that
would cause a committee to exceed its allocation.

But this is for purposes of enforcement in the House only. What the
House does has no effect whatsoever on the Senate or its budget
enforcement. And vice versa, if the Senate deems that its budget
resolution has been agreed to.

Does the lack of a budget resolution matter? Jim notes that budget
resolutions are supposed to set limits on discretionary spending in
appropriations bills and facilitate changes in taxes and entitlements
via reconciliation instructions or via allocations to authorizing
committees. But nowadays, discretionary spending caps have already been
set by the Budget Control Act (which ended the debt ceiling standoff)
and there is little or no prospect of cross-party agreement on tax or
entitlement policies. Moreover:

With the exception of reconciliation legislation, it effectively takes
60 votes to consider any legislation in the Senate so it really does not
matter whether the resolution has been adopted; if you have 60, you can
consider the legislation, if you don't, you can't.

The bottom line is the budget process set out in the Budget Act works
pretty well when the Congress can agree on budget policies. When they
cannot, no process in the world can make things work smoothly, but
Congress muddles through and does what absolutely has to be done (like
keeping the government from shutting down or defaulting on the debt).
Not having a budget resolution in place is a symptom of the inability to
reach agreement – not the cause of Congress not being able to
accomplish things.

So yes, the Senate could pass a budget resolution, but without the
cooperation of the house or 60 votes, that resolution would not take
effect; it would be an empty gesture. The fact that the House managed to
pass a budget last year, including a major overhaul of Medicare,
reflects its different rules that allow it to deem the budget resolution
to have taken effect. But it didn't ultimately matter: the provisions
in its budget, including the Medicare changes, were not binding on the
Senate.

We few, we happy few, we band of brothers—For whoever sheds his blood with me today shall be my brother.

Right, wrong, or indifferent the House has submitted and passed several budget resolutions... However, the Senate has 'not submitted' a budget resolution since April 26, 2010. There is plenty of blame to go around for all 537 elected "critters" to share. Keep in mind sports fans that it only takes 51 votes to pass a budget resolution in the Senate. Also, the budgets are only guidelines for spending not law... It's nothing more than a game for votes it's as simple as that and for me that's the real disgrace... IMHO